‘I paid €500 more a month than I should have’
FATHER-of-one Derek Kelly has spoken of the years of hardship he faced due to tracker blunders – saying that during this time, ‘we didn’t need to be in the red’.
Mr Kelly took out a mortgage with Permanent TSB in 2007 on a two-year fixed rate, the terms of which stated that after this period, the family could avail of a tracker if they wished. Struggling to keep up with repayments at 4.75%, he inquired about moving to a slightly lower variable rate, shortly before the end of the two years.
Mr Kelly was moved onto the variable rate – but was not told that by moving from the fixed rate early, he was giving up his entitlement to a tracker rate. Instead, he later ended up entering a five-year fixed-term arrangement at more than 5.5%, paying up to €500 more than he should have some months.
What followed were months and years of hardship for Mr Kelly, his partner and his now three-year-old son.
As a self-employed delivery driver, he ended up falling into arrears of just over €1,000 on his taxes as he struggled to make ends meet. He had no disposable income, and his savings were wiped out.
Then, in July 2015, Mr Kelly received a letter from Permanent TSB informing him that the bank had made certain failures in relation to mortgage management and that ‘customers who should have been able to move their PTSB mortgage to a tracker rate mortgage some time ago may not have done so because of a failure by PTSB’.
‘All that time, we didn’t need to be in the red,’ Mr Kelly said ruefully. He got compensation and redress of around €10,000 and was later told he would be put on a rate of 3.25% – which he says is still higher than the rate his mortgage contract states he should be on, namely the ECB rate plus ‘1.1% maximum’.
He then faced a decision on whether to take on the banks. He said: ‘I thought we had too much to lose, but my solicitors said they had no faith in the appeals process or the ombudsman... They said the bank had admitted liability, and so... would have to carry their own legal fees.’
According to documents, Mr Kelly was overcharged by a total of €20,000 in interest over six years. His case is now due before the courts.
A spokesman for PTSB said: ‘Any customer who is unhappy with the redress and compensation put forward by PTSB can avail of an independent... appeals process – which they can engage in while still accepting the compensation... offered by PTSB.’